Online Marketing - The Smart Way of Promoting

Online marketing is one of the rising types of marketing segment to promote products and services in stunning way.  There are many smart ways online media is catching up the audience using different kind of technology to promote the commodities also it has enormous accessibility and reach it is easy to reach millions of users at one go.

Being the modern and hottest field online media advertising has become focus of attention in all the trading and service firms. According to the media experts online marketing mode carries a lot of prospected audience to make business. Also experts think that online media advertising is in game change period and soon it will beat other traditional media of advertising with its reach and sustainability.

The Smart ways of promoting

The sharpen technology discovering many more new systems to make strengthen of online marketing segment. Below are recent trends which are talk of the town in this industry.

1. Real Time Bidding
2. Behavioral Targeting
3. Make the audience busy through Interactive Creatives
4. Mobile App marketing
5. Games on social media channel

Real Time Bidding: This is one of the booming technologies which enable high return of investment to the advertiser. Real time bidding will be a significant factor that can fulfill the promise of online marketing.

As defined by Parks Associates, the automated process of buying and selling online display advertising in real time, and it incorporates enhanced solutions in targeting algorithms and data analytics in order to deliver better targeting, greater control and more granular campaigns.

In general words we can easily compare real time bidding with stocks market and its operations, but whatever transactions happed in RTB is approximately o.6 seconds.  Once advertisement wins the bid for desired inventory it will start serving to the right audience at the right time. Even still lot more improvements are going on to develop this system and track the accurate data at real time. As predicted in 2012, by this yearend real time bidding is most game changing segment in online marketing.

Using Real Time Bidding, Facebook advertising exchange is assuring the conversions within 2 days to its advertisers and it is working in that advertising exchange with abundance of audience, targeting based on geographical, demographical and behavioral factors.

Behavioral Targeting: This is one of the major parameter that online media used to target the right advertisement to the right customer to get business done within estimated time.  These technologies assess user behavior through user’s activity on World Wide Web.  This technology tracking through user’s IP address and personal information which user has submitted while transacting something else on the web.  Through this user data, various types of the advertisement will target to the respective customers based on their behavior and demographical factors.

Through behavior targeting most of the online media networks retargeting the interested customers through a variety of offers and discounts. Also many data management companies will analyze this data and segmenting the data as per the behavior of a particular customer.

Make the audience busy through Interactive Creatives:  As technology develops, online media is also implementing new techniques to attract the customers towards its products or services. Now most of the displayed creatives which have eye catchy look, color, articles on ads, videos, offers, discounts and many more to attract the customer’s attention from its first impression.

These interactive creatives have all the features in single creatives and this leads customer busy with one of their pages or its services. Also through this kind of the creative we can track user’s activity in each and every second and over again using this data, advertiser can target those audiences for their new products or services.

Mobile App Marketing: Now a day’s most of all are using smart phones and through mobiles we are engaged on many social networks, e commerce services, personal email conversations and chats applications.  These applications will capture potential data of the respective customer and track their activities on web.  Through these kinds of the interactive applications, marketers will target their desired audience to promote the services to its desired pool of customers.

Advertisers are following their own strategies to stay at the top of the game using these mobile apps.  Few are listed as these are recent trends in 2013.

• Retargeting and Real time bidding using mobile apps - Every successful mobile marketing campaign starts with successfully targeting those who will prove most beneficial towards the product or services.  The recent introduction of Apple's Advertising Identifier is helping to develop more complicated real-time bidding and retargeting technology, including the ability to exclusively target the inactive users in an effort to reengage through mobile apps and making other marketers jealous in the process.

Real-time bidding is truly a win-win for the mobile advertising industry, giving buyers more access and transparency while concurrently giving sellers a market-driven fair price.

Frequency of tracking -   This is one of the high debated topics across the industry and still it is going on in this year with lot of facts and figures. Using Unique Device Identifier (UDID) advertiser can track the activities of user. It is one or the other way helpful to understand the user behavior and expectations to optimize the app for stand on the top of the market. AdTruth is also announced a partnership with OpenX Softwares on their new venture to develop Unique Device Identifier technology in Jan 2013.

Advanced data capture about users – From past few years, many industries have squeezed the power of data and now the mobile marketing industry is taking notice and recognizing its value. The possibilities of discoveries using data are endless. Thousands, millions, and billions of data points provide mobile app marketers with a wealth of knowledge on user behavior that was not previously available.

New mobile user behavior: As we discussed above mobile marketing is also booming with other form of online marketing and we can also easily track the behavior of the particular user and potential of customer to promote feasible product.

In TradeMob, we are predicting a change in user structure and behavior in 2013. Due to competition in the tablet and smart phone market increases, service providers inevitably become more accessible and affordable to a larger cross-section of demographics, including less affluent and increasingly younger users.

According to eMarketer, introduction of new tablets like iPad Mini, the number of tablet users is expected to see explosive growth and it is reaching nearly 34 million (in 2011) to 70 million in this year.

Games on Social media channel: Social gaming started in middle of 2007 and officially introduced on Facebook platform.  Since then, Facebook grown from 27 million to 500 million unique visitors and over 70% visitors are engaging with social gaming on various social media networks.

Through these gaming apps advertisers can attract the premium customer especially they will target youth segment of customers to promote their lifestyle, entertainment, sports related merchandise and accessories to the targeted audience. Social media has implemented three methods for driving social games, such as premium placements, ongoing promotions, and viral notification channels from these three methods social media networks attracts daily active users to make revenue out of these games.

Conclusion: Online marketing segment is one of the terrifically growing domains for many uses. As fast as technology develops this domain is also developing in its own sizzling way.  This is the major reason that we all can see online advertising inventories on each and every piece of the web page and it’s just like a popular marketing place put any product or services in front of the right audience at right time also there is no geographical barriers to promote any of the services at any time without any hassles.

Source: http://goo.gl/hXA4s 

Are Ad Exchanges and Real Time Bidding The Next Big Thing?

There is a great deal of buzz in the industry around Ad Exchanges and the technology associated with them. However, it is not well understood how they operate and what the benefits to publishers and advertisers are. In researching this topic, we found that while Real Time Bidding (RTB) receives a great deal of attention, there are other attributes of Ad Exchanges that are not widely discussed, yet have the potential to make a major impact on the digital marketing ecosystem. We’ll attempt to clarify some of the concepts used in the Ad Exchange technology stack in this article. First let’s examine traditional Ad Networks.

How Ad Networks Operate

In the Ad Network model, the building blocks are the traditional components of web advertising: Web Content Servers, Publisher Ad Servers, Advertiser (third party) Ad Servers, Database Providers, Cookies, Tracking Pixels and Content Delivery Networks (CDN).

The process generally works as follows (simplified for clarity):

• User begins to load a web page.
• Web page issues a request for an advertisement from the Publisher’s Ad Server which logs the request and returns a “NET TAG”.
• Web page issues request to the Ad Network Server, which processes its pixel, reads and/or drops its cookie, queries its database and applies targeting (demographic, geographic, contextual, behavioral or all of the above) algorithms. It then applies the rules set in the contract with the advertiser. If it finds a profitable match it issues an ADV TAG and logs the transaction. If it does not find a match, the Ad Network may pass the request on to a partner Network, which repeats the process to determine if it has a profitable ad to display and so on until a network claims the impression. This processes typically involves multiple http requests and redirects, which impact load time negatively.
• Web page processes the ADV TAG resulting in the Advertiser Ad Server either serving the ad or handing off the request to a Content Delivery Network (CDN).
• The browser loads the ad, if the user hasn’t already moved on to another page.

This architecture has evolved as the online advertising industry has matured. At this point, it has become what tech types refer to as a “kluge”- a process which is inefficient, slow to serve creative, problematic to traffic, difficult to report upon and expensive relative to the real cost of the media. Add in secondary networks, yield management techniques and third party data sources and you have a cumbersome architecture that does not scale well.

What Ad Exchanges Do

If you have read this far, you now understand one of the most important (if not often publicized) rationales for Ad Exchanges: Efficiency. Suppose instead of the “Round Robin” approach described above, there was a centralized mechanism for aggregating the impressions offered across multiple Ad Networks and matching them (based on the advertiser’s target, budget and placement requirements) with the most appropriate ads?  What if this mechanism existed in the cloud with a well understood API (application programming interface) for audience targeting data and there was dynamic auction functionality around pricing which allowed the publisher to supply his impression to the highest bidder at any given instant? Add self-serve applications for ad creation, traffic, campaign management and reporting and you have the basic components an Ad Exchange or Demand Side Platform (DSP)

Real Time Bidding (RTB)

Real Time Bidding is a dynamic auction process where each impression is bid for in (near) real time versus a static auction where the impressions are typically bundled in groups of 1,000. The potential advantages are cost efficiency, higher performance and greater granularity with targeting and measurement.

Demand Side Platforms (DSP)

Demand side platforms (DSPs) give buyers direct RTB access to multiple sources of inventory. They typically streamline ad operations with applications that simplify workflow and reporting. These products are directed at agencies, agency holding companies and large advertisers (the buyers). The technology stack that powers an Ad Exchange can also provide the foundation for a DSP, thus there is a synergy for plays in both spaces.

Supply Side Platforms (SSP)

Large publishers incorporate yield management techniques to increase ad revenue. This typically involves managing multiple networks. The SSP play uses the data generated from impression level bidding to help the publisher increase the value of his inventory by being on target. Applications to manage ad operations are also bundled into these solutions. Again, the technology is adapted from the Ad Exchange tech stack.

Obstacles to Adoption

While this technology sounds promising, there are arguments against Ad Exchanges:

• Questionable ability to appropriately value premium inventory.
• Devaluation of direct sales efforts.
• Fear of the commoditization of inventory (allegedly suppressing price).
• Suitability of addressing Branding as well as Direct Response objectives and goals.

While the jury is certainly still out, sentiments on these issues are leaning in a positive direction based upon these assumptions:

• Homepage takeovers, guarantees and deep integration on major properties will continue to command premium pricing and require the efforts of direct sales teams to package, promote and manage.
• Because Ad Exchanges increase reach and provide hooks for multiple third party data sources to plug in to the ecosystem, the ability of the architecture to leverage RTB functionality with accurate targeting potentially raises the value of inventory. Perhaps advertisers will pay more to reach consumers that have been qualified by current, actionable data and are therefore more likely to have immediate brand interest or purchase intent.
• The tactical advantages of Ad Exchanges potentially make branding campaigns across premium inventory more effective by broadening reach. Additionally the tools for targeting, traffic, frequency capping, rotation and reporting are ROI enhancing to brand as well as direct response efforts.

The Players

The technology supporting Ad Exchanges is complex and expensive. In order to scale up to handle the level of traffic enterprise clients demand, software engineers often have to code tools from scratch. Open source and/or off the shelf databases just can’t handle the load.

Therefore, it’s no surprise that the big three (Google, Yahoo and Microsoft) are taking the lead in building out Ad Exchange infrastructure. Their deep benches and pockets allow them to invest the resources necessary to make technology like RTB actually work.

Yahoo’s Right Media was arguably the first out of the gate with an exchange. With broad reach across the Yahoo network it is well positioned and has recently committed to offering more premium inventory.

Google AdEx leverages the DoubleClick Ad Serving platform with RTB. As is typical with Google, the technology stack is the most sophisticated of the top tier exchanges.

Microsoft AdECN is Microsoft’s Ad Exchange for the Microsoft Media Network.

AdMeld helps premium publishers maximize revenue from their ad inventory, reduce operating costs and eliminate unwanted ads by giving publishers access to demand from ad networks, exchanges and DSPs.

PubMatic is an ad monetization and management solution which combines impression-level ad auction technology, brand protection tools and ad operations support.

The Rubicon Project offers Supply and Demand platforms with integrated API’s for data providers.

ContextWeb provides real-time contextual targeting.

AdBrite is an advertising exchange focused targeting and optimization, has real-time bidding, API functionality and a self-service account management interface.

OpenX combines ad serving and yield management with RTB.

Media Math is a demand side buying and analytics  platform that aggregates the AdEx, Right Media and AdECN exchanges.

DataXu offers a real-time ad optimization platform which manages buys on an impression-by-impression basis across AdEX and Right Media.

AppNexus is single-point integration to exchanges and inventory aggregators, including Google’s DoubleClick, Microsoft’s AdECN, and others.

Turn is a demand side platform with targeting, exchange integration and analytics.

Audience Science specializes in segmentation and targeting data.

x+1 is a targeting platform for advertisers and publishers. They also build dynamically assembled landing pages and micro-sites based on demographic and behavioral data.

Triggit integrates with Ad Exchanges via its RTB Platform.

Invite Media’s Bid Manager is a RTB buying application.

Content Monetized by RTB Technology

The evolution of the technical infrastructure supporting display advertising is all the more interesting because this tech stack conceivably is applicable to other media types as well. Imagine video on whatever screen supported by ads delivered with this technology…

Source: advertisingperspectives.com

Features of Real Time Bidding (RTB) Platform

Real-Time Bidding: New era of Digital Advertising

New technologies have introduced a variety of challenges to advertising companies. RTB, or real-time bidding, addresses many of these challenges by providing a direct and flexible method of matching consumers to appropriate advertising content. It offers several key benefits to the buy and sell sides.

Real-time bidding (RTB) will be a significant factor in fulfilling the promise of online digital advertising, which has been on the limit of dramatic changes for many years.

RTB, as defined by Parks Associates, describes the automated process of buying and selling online display advertising in real time, and it incorporates enhanced solutions in targeting algorithms and data analytics in order to deliver better targeting, greater control and more granular campaigns.

Given these strong benefits to ad buyers and sellers, RTB is starting to claim more revenues in the online advertising industry, and by 2017, it will account for 34 percent of all online display ad revenues.

Challenges in Online Advertising

Several industry factors will drive this shift to RTB. New technologies have introduced a variety of challenges to advertising companies. Consumers can skip commercials or go completely "over-the-top" in their video viewing, and they are now using multiple screens to consume content. Parks Associates consumer research reports over one-half of U.S. broadband households have a smartphone and nearly one-third have a tablet. All these extra screens make it more difficult to follow consumers and necessitate detailed tracking solutions.

These types of tracking solutions raise privacy concerns, often cited by advocacy groups, which could lead to customer rejection of the online advertising industry as a whole. However, Parks Associates' report Advertising Strategies on Connected TVs finds 45 percent of U.S. consumers are comfortable with targeted ads based on their TV-viewing habits. Over one-third are comfortable with targeted ads based on their online browsing habits, according to the report Monetization of Multiscreen Video: Content Owner Strategies.

While there are and always will be some consumer segments unwilling to share any details of their buying and browsing habits, many consumers are willing to provide personal details in exchange for something of value.

The more significant challenge has been in matching consumers with the appropriate content and, in some cases, matching consumers with any content. For the past 10 years, companies looking to buy and place online ads on a large scale typically have purchased blocks of ads, usually in groups of 1,000, through ad networks. Agencies pay these ad networks a CPM-based rate to reach audience segments with the understanding that a portion of the online ads will not reach intended consumer targets. The industry considers ad networks as "blind-buys": Buyers do not have full control over ad placement; so as a result, ads can appear on any website located in the network.

RTB addresses many of these challenges by providing a direct and flexible method of matching consumers to appropriate advertising content.

How Does RTB Work?

RTB is a data-driven buying model through which ad agencies place auction-based bids for individual ad impressions. This process takes place in milliseconds, allowing agencies to adjust their strategies almost immediately based on the performance of individual sites and ad impressions.

When a user visits a website, in addition to serving up HTML code, the Web server delivers an ad tag to an ad server, which ultimately sends the user's cookie ID to an SSP (supply-side platform) or ad exchange to be auctioned using RTB APIs. Buyers use that ID data to value the ad impression and set their bids. In an RTB environment, ad buyers analyze multiple variables of an ad impression, such as demographics, geography, and publisher attributes. The ad exchange determines the winner, and then the information flow goes back to the ad server to deliver the ad to the user's browser. This entire process is done automatically, in real time.

Below are a few examples to illustrate the meaning of RTB and its benefits beyond the standard targeting parameters (Geo Target, Gender, Age, Category, Demographic, etc.). Let’s say we want to set a maximum bid price for display ads in a campaign (bid = $1 DCPM). We can set the system to change the bids according to a set of rules, and all in real time (50 milliseconds before the ad loads)!

For example:

• If your ad appears below the fold - bid 0.25c
• If the user is seeing the ad for the first time – bid $1
• If the user saw the ad 3 times this week – bid $0.5
• If the user saw the ad 5 times this week – bid $0.1
• If the user saw the ad 7 times this week – don’t bid
• If the user visited your site in the past (retargeted user) – bid $3
• If the user visited your site and left at the checkout – bid $5 (and show him an ad with a discount!)
• If the user usually visits sites similar to yours – bid $2

RTB offers several key benefits to the buy and sell sides.

Core Benefits of RTB

Ad Buyers - Ad Agencies	Ad Sellers - Online Publishers
Accurate audience targeting Campaign control and transparency Improved return-on-advertising spend (ROAS)	Greater yield optimization Higher value of inventory Incremental revenues for display ads sold outside of direct relationships with buyers

While there are several paths for agencies to take when employing RTB, most use a media buying desk (MBD) that relies on demand-side platform (DSP) technology to access and bid on RTB ad impressions. An MBD is a buy-side platform that consolidates the process of planning, buying, serving and reporting online media campaigns, typically leveraging the technology offered by DSPs. Agencies also compile proprietary audience intelligence profiles through their MBDs, which integrate with third-party DSPs. DSPs connect ad inventory to agencies and measure a campaign's efficacy against its goals.

Agencies know who they want to contact due to data management platforms (DMPs). DMPs provide audience intelligence across the entire digital ad ecosystem, not just the RTB ad market, containing info on variables such as purchase intentions, household demographics and behavioral patterns. DMPs collect, manage, and evaluate online user information obtained from multiple media sources to identify and create audience segments. They enable the delivery of the right ad unit to the right consumer on the most effective media channel.

The confluence of these elements boosts the overall value of the RTB process for all players, so much that on the supply side, publishers are beginning to release premium inventory to SSPs to capture larger shares of ad budgets processed in RTB markets.

Facebook and Ad Exchanges

In mid-2012, Facebook announced the expansion of its growing display ad business into the RTB marketplace, with several DSPs already testing the Facebook Exchange, or FBX. RTB-enabled ad exchanges aggregate ad impressions across many online channels and connect ad sellers to buyers. Primarily a sell-side service, ad exchanges provide ad inventory details, such as website type, ad unit size, and user geography to ad bidders (e.g., MBDs, DSPs, ad networks). They also manage the entire ad-auction process - receiving the bid, determining the winner and facilitating ad placement.

Within the FBX system, brand advertisers can target Facebook users based on their Web-browsing history, with ads displayed on a Facebook page based on third-party Web browsing habits. It matches users more closely with not just relevant content but with products where they have displayed purchase intention. For example, Facebook Exchange can serve up ads about cheap flights or local auto dealers to a user who has visited a travel site or the Ford home page.

FBX indicates Facebook is getting more aggressive in its advertising methods -- and is forging new ways to build revenues. According to comScore, the social network serves approximately one-third of U.S. display ad impressions, so the FBX could open up a large source of ad inventory to the RTB market.

Facebook is competing with other companies in the RTB market, notably Yahoo and Google, which have established their presence in the RTB market through a variety of acquisitions. Yahoo acquired Right Media in 2007, Rubicon Project purchased Fox Audience Network in 2010, and Google followed suit in 2011 with the acquisition of Admeld.

Growth of the RTB Market

Agency demand for cross-platform ad synergies will drive the development and adoption of RTB sell-side platforms for emerging media, particularly mobile, online video, and social media, but these markets will remain small, with growth contingent on the maturation of the online display RTB ad market. Even so, Parks Associates asserts this market will grow quickly. RTB is a complicated process, with unfamiliarity and a lack of industry knowledge as potential inhibitors, but even if they have any significant impact, they will serve only to slow growth, not stop it.

The advantages of the RTB process to ad buyers and sellers are simply too great to ignore. Ad spend will shift away from traditional online display advertising to the RTB ad market as buyers become more comfortable with the concept and realize benefits such as cost efficiencies, reduced ad waste, rapid scalability, and improved control and transparency. RTB revenues generated by online display ads in North America will reach US$1.6 billion in 2012 and $7 billion by 2017.

Source: ecommercetimes.com and adgorithms.com 

Real Time Bidding (RTB) Eco System - An Infographic

What is Real-Time Bidding (RTB)

Real-time bidding (RTB) is a relatively new advertising technology that allows online advertising to be purchased and served on the fly. Instead of reserving prepaid advertising space, advertisers bid on each ad impression as it is served. The impression goes to the highest bidder and their ad is served on the page. The closest analogy would be to the stock market: as stocks (online advertising spaces) come up for sale, brokers (advertisers) bid for the stock. Whoever bids the highest price gets that stock (the ad is served). Then the process immediately starts all over again.

How do advertisers decide when to bid on an ad? Real-time bidding (RTB) platforms buy data about users from across the web. The data is usually in the form of behavioral data gathered from tracking cookies. This information is then fed into the real-time bidding platform, giving advertisers insight into who is about to be served the ad.

Here’s a simplistic example of how real-time bidding (RTB) would work in  the real world: A user spends a lot of time on financial websites, checking stocks and looking up Morningstar ratings. They arrive on a webpage that uses Real-Time Bidding to serve ads. 

On the back end, a major financial services provider has specified that they are interested in users that like stocks. A luxury carmaker has also indicated interest in this audience. The RTB system matches these advertisers with the user profile and they bid on the ad.  Whoever has the highest bid wins, and their ad gets served.

Of course, all this happens in the blink of an eye. Advertisers don’t literally sit and bid on individual ads. Like Google AdWords, they set maximum bids and budgets. The user criteria can also be very complex, taking into account everything from very detailed behavioral profiles to conversion data.

The amount of ads sold through RTB is still relatively low percentage of the overall $26 billion US online advertising market. However, a recent study from Forrester predicted that RTB spending will increase 130% from 2010 to $823 million in 2011.

RTB technology is at the forefront of innovations in the advertising world. This platform is not only allows access to the majority of the world’s leading exchanges, networks and premium sites, it also contains superior targeting methods and advanced bidding options.

Source: crowdscience.com

Online display advertising ecosystem

The biggest divide in the online advertising world is search advertising v/s display advertising. Search sounds exactly like what it is: the ads next to search results on Google, Yahoo, Bing, and competitors. Search is bigger than display by revenues, and much more concentrated. 

The benefit of search to advertisers is it corresponds much better than display advertising to intent.  A searcher for “hotels in Palm Springs” is most likely in the market for a hotel in Palm Springs. The other thing search has going for it is its easy and quantifiable — you can sign into Google Adwords with nothing more than your credit card, type up some text ads, and be running campaigns with impression and click reporting within hours.

The display advertising world is structured differently. Display ads are obviously those pictures you see plastered all over the sites you visit. There’s less intent so individual impressions earn a lot less money. Typically the prices are measured as CPM, Cost Per Mille, i.e. cost per 1k impressions. It’s also important to understand the structure of the market a bit. 

In the beginning (90s), advertisers pretty naively bought ad impressions millions at a time on popular sites. Performance was often evaluated based on pure impressions or CTR, click through rates. Ads were often sold on the basis of quantifiability — you could, for the first time, measure how many ads were seen, who clicked, how often, where he or she went, etc. As search advertising evolved, I think a lot of the people chasing quantifiable advertising moved to that, while display became more about branding. This, btw, is the value of facebook — brand advertisers want to be able to precisely target age, gender, income, and other demographics; on facebook, users freely and generally accurately share this information.

The display ecosystem has a bunch of moving pieces. If you look at the display advertising tech landscape graphic from Luma Partners, you’ll see:

Agencies 

These are the big advertising agencies that run most large advertising accounts go through. Companies like Toyota, GM, General Mills, etc, will give these companies tend to hundreds of millions of dollars to run ad campaigns on their behalf.

Media Buying Desks 

The ad agencies weren’t really capable of managing digital campaigns. That is, when ad agencies came about, your media outlets were maybe 10 national TV networks, radio stations, local newspapers, and a couple national magazines. And the media buying process was pretty simple: the agencies would send out an RFP that said we want manly men in their 40s who buy outdoorsy cologne and the aforementioned publishers would respond and say how their audience matched that profile. Compared to the online world of today, where there are thousands of premier publishers such as the NYT, ESPN, online magazine versions, etc; this was much simpler. 

Today, trafficking ads is an order of magnitude more work and advertisers must decide what they want to buy, where, on which site, when, with what creative, etc. So the agencies built or bought companies that have the capability to build digital media, traffic campaigns, optimize the ads, and create the necessary reporting. Eg Vivaki is Publicis, b3 is WPP, etc.

Ad Exchanges 

These are, well, exchanges where publishers and advertisers come together to sell and buy remnant ad inventory. Basically, there is premier and remnant inventory. Premier inventory is something like display ads on high quality reporting on ESPN or ads on articles on ARS Technica. These are often sold by in house salespeople in a process remarkably similar to how everything used to work, though people mostly email PDFs instead of sending faxes. Every ad impression that isn’t sold as premier is referred to as remnant, and these remnant impressions are offered to ad exchanges such as Right Media — RMX, owned by Yahoo — in exchange for a cut.

So the way this works is I can buy, with some rules, 1MM impressions on RMX and RMX will put these impressions on their publishers such as ESPN in ad impressions that ESPN didn’t sell in house. These impressions go for an order of magnitude less money than premier. RMX is one of the more technically sophisticated. The benefit for publishers is they get some money for inventory they didn’t fill. Just to be clear, a good eCPM for premier might be $20-$40 and a good eCPM for remnant might be $3-$5.

Demand Site Platform

A DSP helps advertisers purchase remnant ads across multiple ad sources including exchanges, ad networks, and individual publishers. A good DSP will have sophisticated targeting and optimization algorithms that incorporate first and third party data on behalf of the advertisers. Typically, a DSP’s clients are advertisers that aren’t big enough to go to one of the big seven agencies. Often these advertisers spend $10 – $50k / month, for example a local Toyota dealership instead of the national dealer chain, etc.

Ad Servers 

These help publishers. See Exp: OpenX, DoubleClick Dart, etc. Particularly for larger publishers, coordinating all these ad purchases is complicated. Your advertisers want to give you rules, such as user bleaching rules (only so many impressions to a given user per some amount of time), time of day, what pages an ad can run on (few people want to run next to naked folks, etc). 

They also want to be able to update and optimize their creative or even change the creative or the landing page they go to. Advertisers, or their agencies, also demand reporting — how many times was an ad seen. On what pages did users click on the Ad etc., within publishers the ad sales or monetization folks don’t want to be releasing the site every time they tweak Ads. Ad servers are internal or external software that manages all this and can be quite complex.

Data optimization 

This requires some explanation. In the beginning, people basically bought broad swaths of display ads. The value to optimization is the more targeted you can make your ad, the more value it has. My favorite example is espn: assume 10% of their online audience is female. If you’re an advertiser that wants to sell female sports jerseys, your CTR amongst women is 5%, your conversion rate is 5%, and a conversion is worth $50, your value per 1k impressions is 1000 * .1 * .05 * .05 * 50 = $12.5, so your CPM has to be < $12.50. However, if espn could pick out the women and sell the publisher only that segment (with some error, obviously), but say espn can enrich the demos so that women are 50% of impressions in a segment. Suddenly advertising on espn is worth 5 times as much for the advertiser and hence espn can charge 5 times as much. This is the value of data optimization. It's performed many ways, from things as simple as geo targeting and day part to more sophisticated demographic estimation, retargeting, and varieties of behavioral retargeting.

Re-Targeters 

Re-targeting is a simple idea. Say that I see cookies going to a site like a bmw forum. I might reasonably intuit that these users are interested in bmws and choose to show bmw display ads to them as they browse the internet.

Behavioral retargeting is the next step of retargeting. Plain retargeting is nice, but it suffers from a couple flaws. First, it has limited reach, ie there are only so many cookies that go to a bmw forum. BMW probably wants to reach more purchasers than just those. Second, it doesn’t really help generate intent. If you’re going to a bmw forum, you’re probably already pretty interested in bmws, so that may not be the best person for bmw to advertise to. Behavioral retargeting means any of a variety of ways of trying to figure out cookies to advertise to to get broader reach or cheaper acquisitions than retargeting.

The other big movement going on in the display world is the evolution of how people buy ads. In the early days — 90s — people tended to buy online ads in a high touch process with salespeople. Ad networks started which brought more buyers and fewer salespeople. Companies like Right Media — which Yahoo bought — started and allowed you to create bidding rules that run on their servers so advertisers can buy ads. So I can say that I want to, across many websites, target cookies that have visited a site or set of sites (retargeting), or show them so many ads per day, etc, and based on a variety of characteristics of a cookie and the site which that cookie is visiting and the web page they are viewing, $X is my bid for that cookie. 

RTB or real time bidding 

This is the new - now, instead of giving limited rules to someone like RMX, you register with Google (the largest RTB platform) or Yahoo’s RTB, and their servers, for each impression, send you a bid request. Your computers located in a server farm near their servers are given typically 100ms to respond with a per impression bid for that cookie on that page and that impression. See. Also, this is obviously an enormous tech investment. DSPs also help with this; most companies aren’t capable nor is it worthwhile to build this out in house.
Source: blog.earlh.com